always Caterpillar it represents one of the most faithful indications of the state of health of Corporate America. Hence the concerns of Wall Street after the accounts of the giant (-7,7%), which were paired with the decline of 3M, the post-it company (-4,4%), another flagship company of the made in the USA. What worried the market, despite the growing accounts, was the estimate of a drop in future profits, due to the prospect of the increase in the cost of raw materials (as a result of the war on duties) and wages.
The disappointment was partially offset by the good health of the companies closest to the consumer economy: McDonald's + 6,3% Verizon + 4,1% thanks to the strong growth of new subscribers. But the upward tension of inflation and the pressure on profits still emerge from the accounting season. This explains the discontent of Wall Street (-2,3% the S&P in the morning), then corrected by the recovery in the final which did not, however, erase a sensation: beyond the geopolitical tensions, the global economy is destined to slow down .
In short, the best is behind us, as confirmed by the data on the European quarterly reports. This is certainly not good news for Italy's bet on debt-based growth, which is based on the hope of strong economic growth. On the contrary, as confirmed by the slowdown of the German Stock Exchange, the most sensitive to the trend of global demand, the indications go in a completely different direction.
Asian stock markets rebound after a difficult start: Tokyo +0,4%, Hong Kong +1%, Shanghai +1,5%, Seoul +0,2%, Mumbai +1%.
Closing in the red instead for the US markets, pending the accounts of Microsoft, Alphabet and Amazon. Dow Jones and S&P 500 lose half a point. Nasdaq -0,42%.
Brent-type crude closed down 4,3% at 76,5 dollars a barrel: this morning on the Asian financial markets the price was 76,7 dollars. It opened in a freezing climate, despite the temperature, Davos in the desert, deserted by governments and companies after the assassination of the Saudi journalist Khashoggi.
Oil prices are down as a result of the drop in crude oil prices. Sales in Piazza Affari on Saipem (-4,6%) and Tenaris (-3,94%). Eni-1,6%.
The euro moved little this morning at 1,147 against the dollar, in the aftermath of the historic rejection of the draft of the Italian budget by the European Commission. The BTP restarts from 3,58% yield. But there is still no contagion effect on the rest of the eurozone. On the contrary, the titles of Spain, Portugal and those of Greece strengthened, getting closer and closer.
The Japanese fund Sumitomo Mitsui Trust Asset Management (90 billion dollars of managed assets), lets it be known that it is buying Spanish bonds but has no interest in Italian paper, where, according to the managers, a deterioration is to be expected of the situation.
EUROPE DOWN 10% IN 2018. FRANKFURT SUFFERS
Piazza Affari suffers on the day of the announced rejection of the maneuver. But less than the other European lists which during the session reached their lowest level for two years, confirming that the Eurozone's malaise is not only of a political nature: the Eurostoxx has broken through the -10% barrier since the beginning of the year. Today's PMI data will make it possible to understand whether the weakness of the markets depends on political issues and the international context or if it reflects the further weakening of the European cycle.
Piazza Affari loses 0,86% and drops to 18.802 points after fluctuating between a minimum of 18.705 and a maximum of 18.954.
Frankfurt is doing worse (-2,11%), dragged down by Bayer (-9,52%), after the confirmation of the merits of the indemnity sentence against Monsanto.
Paris -1,69%; Madrid -0,79%; London -1,69%; Zurich -1,18%. The euro remains slightly moved against the dollar, in the 1,148 area.
BTP 10, ONLY 69 POINTS ABOVE GREECE
The debt market is under tension. After a parenthesis in positive territory, the BTPs closed down in line with the start of the session: spread up by 14 basis points to 317, 3,58-year yield at XNUMX%.
The downward slide in the value of Italian paper continues. The yield differential between Italy and Greece is narrowing. The 69-year BTP trades at 78 basis points more than the Hellenic bonds by XNUMX at the previous closing.
In the first eight months of 2018, Bank of Italy calculates, foreign investors reduced their positions in Italian portfolio securities by a total of 42,8 billion: the divestments "above all" involved public securities, for 24,9 billion, and bonds bank, for 12,4.
TOMORROW THE SPEAK AT THE ECB, FRIDAY AT S&P
Meanwhile, the unprecedented confrontation with Brussels on the Italian maneuver is advancing. The college of commissioners, after the rejection of the text sent from Rome, formally requested a Draft Budgetary Plan (Dpb) "revised within three weeks".
"Today, for the first time, the Commission is forced to ask a member state to review its draft budget," said the vice-president of the Community executive, Valdis Dombrovskis, during a press conference. "The Italian government - he added - is going openly and knowingly against the commitments made".
The Italian government has announced that it will respond to the European Commission within the three-week time frame with a "constructive spirit" but without changing the basis of the manoeuvre.
Attention shifts to two other crucially important appointments: tomorrow's meeting of the ECB, from which news on the QE front could arrive; S&P's decision on Italy's debt rating, expected on Friday with the markets closed.
STM -3%. THE BOD ANNOUNCES REVENUES +18% IN THE QUARTER
Stormy day for European technology. The sales were triggered by the announcement by chip maker ASM, a supplier of Apple, of a sharp decline in profitability in the current quarter. The stock sank on the Zurich Stock Exchange, with a loss of up to 23%.
Stm ended the day with a loss of 3%. Quarterly data was announced late in the evening: net revenues at $2,52 billion (up 18,1% year-on-year). Operating margin at 15,8% (up 270 basis points year over year), net profit at $369 million (+56,7%). In the fourth quarter revenues are expected to grow by 5,7%.
WEAK BANKS, MPS TRY TO CLEAN UP
The banking sector was weak (-0,35%), but without particular movements. Unicredit -0,2%. Flat understanding. Banca Monte Paschi (-2,5%) is closing the sale of 2,4 billion of non-performing loans, there are at least four parties in the tender, including Banca Ifis +1%.
Bench Bpm -1,3%. The investigating judge of Milan Guido Salvini has ordered the closure of the investigation opened at the beginning of 2017 with the hypothesis of the crime of market manipulation on alleged omissions in the communication to the market of data on the coverage of non-performing loans held by Banco Popolare.
Managed by Banca Generali (-3,2%).
FCA, POSSIBLE EXTRA COUPON. LUXOPTICAL ADVANCE
In a negative general picture, few positive notes emerge.
Fiat Chrysler (+1,7%) could pay an extraordinary dividend, thanks to the proceeds from the sale of Magneti Marelli. Meanwhile, S&P assumes a rating upgrade, provided that liquidity is used to reduce debt.
Luxottica (+3%) closed the 9 months with revenues of 6,767 billion, down 4,5% at current exchange rates but up 1,3% at constant exchange rates, after an improving third quarter which allows it to confirm for the end of the year an increase in turnover of around 2% at constant exchange rates, on the low end of the guidance, and a "solid profitability".
INDUSTRY UNDER FIRE. SOGEFI LEAKS AFTER THE ACCOUNTS
The majority of industrialists suffer. Cnh Industrial -3,5% in the wake of the collapse of Caterpillar (-7%) on Wall Street. Sogefi -7,53% the day after the results. Also in the red were Prysmian (-3,27%), Ferrari (-2,28%) and Buzzi Unicem (-1,43%).
MONCLER AND CUCINELLI IN RED DESPITE THE PROMOTIONS
Massive sales on luxury. Moncler -4% despite the fact that Berenberg has announced that he has started hedging with a Buy judgment and a target of 37 euros. Potential upside +20% compared to yesterday's quotation.
Salvatore Ferragamo (-2%) corrects after Monday's leap. Brunello Cucinelli resets about two initial points of gain and moves down by 2,7% in the final. Berenberg promoted the judgment to Buy from Hold, target price unchanged at 34 euros.
DANIELI UNDER FIRE. ASTALDI'S LANDSLIDE CONTINUES
Bad day also for the mid caps. Astaldi's decline continues (-9,26%). Danieli falls by 8,53%, following the requests for convictions made by the Udine Public Prosecutor's Office for the company's top management following the investigations launched a few years ago into the alleged crime of tax fraud for a total of 281 million, with evasion of 80 million in disputed taxes.
Tiscali falls by 8,2% on the day it was announced that the Russian shareholders have interrupted negotiations on the subscription of a convertible bond.
